The following update was sent to my newsletter subscribers this morning. I cover and recommend a handful junior project development companies that I believe will be acquired in the next 12-24 months. A paid subscription to this substack includes a subscription to my Mining Stock Journal. You learn more about here MSJ information.
Angus Gold (ANGVF, $GUS.V) and Wesdome Mining (WDOFF, WDO.TO) announced a friendly merger in which Wesdome is acquiring Angus. Wesdome is paying an aggregate value of C$0.77 (approximately 54 cents US$), consisting of C$0.62 in cash and 0.0096 of a Wesdome share (96 shares of Wesdome for every 10,000 shares of Angus). The offer is a 59% premium to Angus’ 20-day volume-weighted average price through April 4th. All of the large shareholders have signed-off on the deal (Angus insiders 28%, New Gold 8%).
The market liked the transaction because, as I write this, Angus is trading up 61% from Friday’s close and Wesdome is flat (9:42 a.m. MST). Typically when there’s shares involved the acquiring company’s stock gets hit.
I’ve covered and invested in Angus since 2021. I always thought Wesdome would be the most logical acquirer of GUS. I was surprised that the announcement came now, while Angus is still relatively early-stage (a year away from a maiden resource estimate).
Up until recently, strategic acquirers have been waiting until a junior’s project is nearly fully de-risked before buying the project/company. This is the earliest stage acquisition that I’ve seen since the 2008 – 2011 era (I may have missed some since then if there were any). If this trend continues I think there will be a lot of investor capital that moves into the junior project developers.
While I think ultimately Angus will be worth at least low nine-figures, it was going to take several years before that value would be unlocked and there’s no guarantee the project gets over the finish line. The deal price is not as high as the stock’s highest point in 2021-2022, but it’s more than double the March 4th close of 21 cents on ANGVF.
I sold my shares because I don’t want exposure to any type of deal or market risk right now. Also, I have not done a deep-dive on Wesdome and I didn’t want exposure to the shares in the current market environment. I will take a close look at Wesdome once the market is more stable